The Great Bitcoin Boom: Which Countries Use Bitcoin in 2025?

The Rise of Bitcoin and the Global Dilemma

Bitcoin, the world’s first peer to peer digital currency, debuted in 2009 and introduced a revolutionary concept: decentralized finance. Free from central banks or government control, Bitcoin promised to give financial power back to the people. But while millions of users and investors embraced it, governments around the world were left with a question they still struggle to answer today: Should Bitcoin be embraced, regulated, or banned?

The legal status of Bitcoin varies widely. In some countries, it’s a taxable asset or even legal tender, in others, it’s a criminal offense to use or trade it. This global divide shapes how Bitcoin is used and perceived around the world.

In this post, we’ll explore which countries support Bitcoin, which restrict or ban it, and why.

Countries Where Bitcoin Is Legal and Encouraged

El Salvador

El Salvador made history in 2021 by becoming the first country to adopt Bitcoin as legal tender. President Nayib Bukele’s administration launched the Chivo Wallet, distributed Bitcoin to citizens, and built a crypto infrastructure including Bitcoin ATMs and plans for a “Bitcoin City.” This move aimed to improve financial inclusion and attract foreign investment.

Central African Republic (CAR)

In 2022, CAR became the second country to make Bitcoin legal tender. The move was surprising but bold, as CAR hopes to modernize its economy and escape dependency on the CFA franc. Challenges remain, including limited internet access and low public awareness.

The United States

Bitcoin is legal in the U.S. and is treated as property for tax purposes by the IRS. The Financial Crimes Enforcement Network (FinCEN) considers cryptocurrency exchanges and wallets as money services businesses (MSBs). These must follow AML and CFT regulations, register with the U.S. Treasury, and report transactions over $10,000. In 2024, the U.S. finalized regulations on digital asset transaction reporting, including how tokenized assets should be categorized and taxed.

Canada

Like its southern neighbor, Canada recognizes Bitcoin and treats it as a crypto asset. Cryptocurrency exchanges must register with FINTRAC, follow AML/CFT laws, and report suspicious transactions. Profits from crypto activities are taxed either as business income or capital gains.

United Kingdom

The U.K. has long accepted cryptocurrencies. In 2023, it updated its Financial Services and Markets Act to regulate various types of digital assets, including: Exchange tokens, Stablecoins, Asset-referenced and commodity-backed tokens, Governance and fan tokens and NFTs. These assets must meet operational and reporting standards, ensuring consumer protection and industry transparency.

European Union

The EU recognizes cryptocurrencies as crypto assets, governed by the Markets in Crypto Assets (MiCA) regulation. Though not all member states are required to legalize Bitcoin, those that do must comply with MiCA’s consumer protection, financial reporting, and licensing frameworks. Countries like Germany, France, Denmark, Austria, and Spain have embraced Bitcoin under these guidelines.

Australia

Bitcoin is legal and taxed in Australia. The Australian Taxation Office treats Bitcoin as an asset subject to capital gains tax when sold, exchanged, or used for purchases. However, if you hold Bitcoin for personal use and make a gain, you may not owe taxes.

Other Pro-Bitcoin Nations

Japan: Recognizes Bitcoin as legal property under the Payment Services Act.
Switzerland: Particularly in “Crypto Valley” Zug, Bitcoin is widely accepted.
Singapore: Allows trading and is a hub for crypto startups.
UAE: Especially in Dubai and Abu Dhabi, crypto-friendly zones and blockchain projects thrive.
Bahamas: Known for the Sand Dollar, but also open to Bitcoin.

Countries With Bitcoin Legal but Tightly Regulated

India

India has not banned Bitcoin, but has imposed a 30% tax on digital asset gains. Crypto businesses face uncertainty due to lack of clear legislation, though the country is exploring a central bank digital currency (CBDC).

South Korea

Bitcoin is legal, but exchanges must register with the government and follow stringent AML rules. South Korea emphasizes security and investor protection.

United States (Revisited)

Though legal, the U.S. maintains a regulatory patchwork involving multiple agencies (SEC, IRS, CFTC, FinCEN). Crypto platforms must meet strict compliance standards.

Countries Where Bitcoin Is Illegal or Severely Restricted

China

Once a hub for Bitcoin mining, China banned all crypto-related activities in 2021. The government is now focused on the digital yuan (its own CBDC) and seeks to maintain control over financial systems.

Saudi Arabia

Bitcoin use is prohibited by the Saudi Arabian Monetary Authority. The government sees it as a threat to monetary stability.

Pakistan

Pakistan’s central bank prohibits Bitcoin transactions through banks and financial institutions. However, crypto activity still exists informally.

Morocco

Despite high peer to peer usage, the government has officially banned Bitcoin since 2017.

Algeria, Tunisia, and Bangladesh

All have outright bans on Bitcoin trading, ownership, and mining. Violators risk fines or imprisonment.

Bolivia and Nepal

Both countries have criminalized Bitcoin use, citing risks like fraud and financial instability.

Why Do Countries Have Different Views on Bitcoin?

Reasons to Embrace Bitcoin

Financial inclusion for the unbanked
Attracting tech investment
Bypassing weak national currencies
Lower transaction fees on remittances

Reasons to Restrict or Ban It

Fear of losing control over monetary policy
Risks of money laundering and terrorist financing
Price volatility
High energy usage (from mining)

CBDCs aim to modernize monetary systems while retaining regulatory control. However, they lack Bitcoin’s decentralization and privacy.

The Future of Bitcoin Is Global, But Uneven

Bitcoin’s global journey is as divided as it is exciting. While countries like El Salvador are betting their futures on Bitcoin, others like China are working hard to stamp it out. Most fall somewhere in between testing regulations, adapting policies, and watching carefully.

One thing is clear: Bitcoin is no longer just an experiment. It’s a global phenomenon influencing finance, politics, and digital sovereignty. As more people understand and use it, governments will have to decide not just whether to allow Bitcoin but how to live with it.